Robert Kovacev discussed the implications of the Internal Revenue Service's (IRS) plans to expand its program for auditing large corporations in part by using artificial intelligence (AI). The IRS will be going through masses of data it has on companies, including tax return information and publicly available financial data such as U.S. Securities and Exchange Commission (SEC) filings, Kovacev said. The agency's recent announcement, with its emphasis on data analytics, is a nod to launching audits based on whatever anomaly its algorithm finds, Kovacev noted. "I think a lot of large businesses that haven't been audited in a long time will receive audit notices seemingly out of the blue," Kovacev said. "Those are likely to be technology-driven." According to Kovacev, some businesses "have become complacent" over the past decade, and haven't paid enough attention to the possibility of an audit and having to prepare for that audit. "This announcement tells those businesses they need to ensure that they have substantiation for their tax positions, and they are ready in advance to defend any positions on their tax returns," he said. "Otherwise, they may find themselves playing catch-up late in the game after they receive an audit notice from the IRS."